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Drillships ups term B-1 to $975 million, trims B-2 to $825 million
By Sara Rosenberg
New York, July 2 - Drillships Financing Holding Inc. (Ocean Rig) upsized its seven-year and eight-month term loan B-1 to $975 million from $900 million and downsized its three-year and two-month term loan B-2 to $825 million from $900 million, according to sources.
Also, the call protection on the term B-1 was changed to 103 in year one, 102 in year two and 101 in year three from revised talk of 102 in year one and 101 in year two and initial talk of 101 soft call protection for one year, sources said.
Pricing on the B-1 loan is Libor plus 500 basis points with a 1% Libor floor and an original issue discount of 98, after firming at the wide end of the revised 98 to 98½ talk, and pricing on the B-2 loan is Libor plus 450 bps with a 1% Libor floor and a discount of 99.
The term B-2 has 101 soft call protection for one year.
Earlier in syndication, the B-1 tranche saw pricing flex from the Libor plus 450 bps area and the discount change from 99, and the B-2 tranche saw pricing increased from the Libor plus 375 bps area and the discount widen from 991/2.
At the time of the pricing changes, the company added a net debt to EBITDA covenant to the loans that were originally covenant-light.
Security is a first-lien interest in the Corcovado, Olympia, Poseidon and Mykonos drillships.
Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, Barclays and Goldman Sachs Bank USA are the joint lead arrangers and bookrunners on the $1.8 billion first-lien secured deal (B2/B+), with Deutsche and Credit Suisse the global coordinators.
Proceeds will be used to refinance the existing secured bank debt at both Drillships Holdings Inc. and Drillships Investment Inc.
Parent company Ocean Rig is a Nicosia, Cyprus-based international offshore drilling contractor.
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